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(GIST OF KURUKSHETRA) Sustainable Mining

[June-2021]

Sustainable Mining

National Mineral Policy, 2019:

NMP 2019 was approved by the Union Cabinet. The aim of NMP, 2019 is to have a more effective, meaningful and implementable policy that brings in further transparency, better regulation and enforcement, balanced social and economic growth as well as sustainable mining practices. NMP, 2019 clearly states that “minerals continue to be an important source of foreign exchange earnings.

Reasons for Low Iron Ore Production:

Iron ore is a mineral where reconnaissance and prospecting are not important as it is found mainly near the surface and most of the proven reserves are adequately prospected. Exploration is therefore not much of a problem in case of iron ore. The main problem lies in issue of Mining Leases for the following reasons:

(a) New blocks either not put on auction by States or held on by CPSEs/SPSEs who have either failed to secure MLs or start production/evacuation, owing to multiple reasons, after reservation or obtaining ML.

(b) Non-issue of FC or EC or both on account of several iron ore mines being located in forest areas.

(d) Captive iron ore mines not mining optimally as they did not have the permission to sell surplus iron ore in the market. As a result, huge reserves in such captive mines are lying unutilised.

Steps taken by Government to Enhance Iron Ore Mining

In order to enhance the production of iron ore in the country, following steps have already been taken by the Ministry of Mines by way of amendments to the MMDR Act and Rules:

(a) Insertion of Section 8B, which has allowed for seamless vesting of statutory clearances from earlier lessees to the new ones.

(b) To allow captive miners to sell up to 50 percent of their production after meeting the requirements of the end-use plant an on paying additional royalty to the state government.

(c) Fixing a time frame for Government companies to obtain a ML from the date of reservation and for commencing production & dispatch from the date of obtaining a ML.

(d) Empower the central government to conduct auctions or re-auction processes for the grant of a mining lease if a state government fails to complete the auction process in a specified period, decided after consultations between the Centre and state.

(e) Termination of RP/PL under Section 10A(2b) of MMDR Act so as to make available more than 500 iron ore blocks for re-auction.

(f) Applying a sun-set clause on mines reserved for Government companies so that ML is obtained and production-dispatch commenced within a certain time frame, otherwise the reservation and ML shall be terminated.

(g) Allow private entities engaged by the Government to undertake mineral exploration without the need for RP-PL, in addition to public sector entities.

The impact of these amendments is expected to be the following:

(a) Open up blocked mines for mining.

(b) Use captive mines optimally by giving lessees the option of selling surplus mineral in open market.

(d)Involving private agencies in exploration.

Suggestions for Promoting Environmentally Sustainable Mining:

Environment protection and mining should not be seen as each other’s opponents. Instead, a balanced approach needs to be followed wherein sustainable mining can be practiced. However, it is easier said than done. The following suggestions are worth considering:

(a) Reduce the term of ML from current 30 years to 15 years, with only one extension being allowed for 5 years. There should be a stiff penalty in case the lessee fails to extract the entire reserve from the leased mine.

(b) The lessee should undertake proper mine closure within a specified time frame after the expiry of lease. This would also open up large areas in closed mines where Compensatory Afforestation can be taken up. Presently, in some mines where ground was broken up a century ago are yet to see mine closure, as some reserves are still there or more reserves are being prospected. Slow pace of mining enhances environmental degradation and therefore the lease period needs to be significantly reduced with a clear sun-set clause.

(c) All mineral blocks should be auctioned with pre-approved FC-EC so that ML should be granted within 4 weeks of declaring the preferred bidder.

(d) Manual mining should be banned and only mechanised mines should be allowed to operate. For this the size of the auctioned blocks offered for lease should be large, so as to justify investment in mechanization.

(e) Make it mandatory for evacuation of minerals to be done using conveyors (overhead or ground) upto the Railway siding or slurry pipeline beneficiation plant/pumping station.

(f) Zero waste mining should be the norm and not an exception. Beneficiation plants should be mandatory along with ore processing plants and no surface lease for slime ponds should be granted along with the mine. Dry stacking of gangue should be mandatory.

(g) There should be a limitation on number of persons/workers and their families getting settled in the lease area, so as to reduce degradation of nearby forests due to population pressure. These conditions should be inbuilt in the EC.